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Giants seen fuelling more deals

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The merger mania sweeping Europe is set to continue, with huge deals likely to be hatched in the coming months, according to top-level corporate officials.

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Following the 16 billion euro (about HK$140.21 billion) deal between Societe Generale and Paribas on Monday, DaimlerChrysler co-chairman Robert Eaton, who himself presided over last year's merger between Daimler-Benz and Chrysler, said many more companies - including those outside the car industry - would seek to join the consolidation trend as competition became increasingly fierce.

His comments were echoed by Deutsche Bank chief executive Rolf-Ernst Breuer, who recently took control of the US investment bank Bankers Trust, and who broadly hinted that the bank was about to strike a partnership with Banca Commerciale Italiana (BCI).

Mr Eaton said: 'I believe that mixed marriages like ours are going to be very common going forward. Indeed I believe they will be inevitable. That is not to say they will be easy. Many will fail.' As a result of the past environment in Europe, where virtually every leading country had its own national car-manufacturing industry, the different cultures and deep-rooted management styles inevitably present at each company, would mean that it is increasingly difficult for companies to gel in an effective manner.

'International mergers like ours will, I believe, be a disappointment to those who look past those differences and don't see the hard work that is necessary to make the combinations succeed,' Mr Eaton said.

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But most executives believe the merger trend will continue and Mr Breuer said his bank's own acquisition ambitions had not been fulfilled.

'We have a strategy and the strategy has not finalised and does not come to an end with the acquisition of Bankers Trust. There is much more to do,' he said.

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